Ex-KBR consultant gets 21 months for Nigeria scheme

HOUSTON Thu Feb 23, 2012 7:40pm GMT

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HOUSTON (Reuters) - A U.S. judge sentenced a former British consultant for KBR Inc (KBR.N) to 21 months in prison on Thursday for his role in a massive scheme to bribe Nigerian government officials to win $6 billion (3.8 billion pounds) in contracts for a liquefied natural gas facility.

Jeffrey Tesler, 63, a consultant and lawyer, pleaded guilty almost a year ago to one count of conspiracy to violate and one count of violating the bribery law known as the Foreign Corrupt Practices Act (FCPA).

Despite fighting extradition from Britain, he was sent to the United States in March 2011, where he entered a guilty plea. He faced up to five years in prison on each count and had already agreed to forfeit almost $150 million as part of his plea agreement.

Judge Keith Ellison sentenced Tesler to 21 months in a federal prison, to be followed by two years of supervised release.

Before sentencing, Tesler, a diminutive man in a black suit, told Ellison that he felt "great remorse," and that he had been drawn into the scheme after making contact with high-level Nigerian officials as a real-estate attorney in London.

"I accepted the system of corruption," said Tesler, who also faces possible criminal charges in France for the bribery scheme. "I turned a blind eye to what was happening."

As part of the scheme, a joint venture between KBR and three foreign companies paid consulting fees to a Gibraltar company controlled by Tesler who in turn used the money to pay bribes to Nigerian government officials.

U.S. prosecutors said Tesler was a "corrupt attorney" and a "gatekeeper" to buying influence from Nigerian officials.

"Mr. Tesler was a sophisticated player in this area," said Patrick Stokes, a government attorney. "He understood how to make the bribery happen."

Tesler's lawyer, Bradley Simon, said his client had "never heard of the FCPA" when he entered into the agreement with KBR and its partners.

"It's the sad fact of life that if you construct anything in Nigeria, that's what you're up against," Simon said.

The former chief executive of KBR, Albert Stanley, is due to be sentenced later on Thursday. KBR was previously a unit of oil services firm Halliburton (HAL.N) but was spun off in 2007 and in 2009 they agreed to pay $579 million to settle bribery allegations.

Stanley, who served at one point under former Vice President Dick Cheney at Halliburton, pleaded guilty in September 2008.

KBR pleaded guilty in 2009 and admitted that it paid $180 million in bribes to Nigerian officials to win the $6 billion in contracts for the Bonny Island LNG project in the Niger Delta. Partner companies from Italy, France and Japan were involved.

The bribes - some delivered in a briefcase stuffed with $100 bills - were paid to officials in Nigeria's executive branch as well as the state-owned Nigerian National Petroleum Corp, the U.S. Justice Department has said.

At various points, huge sums of money were wired through banks in Amsterdam and New York to accounts in Monaco and Switzerland.

On Wednesday, Judge Ellison sentenced another Briton, Wojciech Chodan, to probation for taking part in the bribery scheme when he worked at a unit of KBR. He had cooperated with the investigation.

(Reporting By Chris Baltimore; Writing by Jeremy Pelofsky; Editing by Lisa Von Ahn and Tim Dobbyn)

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